Quick overview

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The Mexican peso strengthened against the dollar on Wednesday, advancing for a second straight session as market sentiment improved on expectations that the war in the Middle East could end soon.

The spot exchange rate stood at 17.8317 pesos per dollar. Compared with Tuesday’s close of 17.9252, according to official data from Bank of Mexico, the move represented a gain of 9.35 centavos, or 0.52%.

The dollar traded within a range between a high of 17.9147 and a low of 17.7958 pesos. Meanwhile, the U.S. Dollar Index — which measures the U.S. currency against a basket of six major peers — fell 0.34% to 99.55 points.

The greenback weakened across markets as risk appetite improved and oil prices declined on expectations that the conflict between the United States and Iran could end within weeks, according to several reports.

Markets watch Trump closely

U.S. President Donald Trump said Wednesday that military operations in Iran could end soon. He added that the Iranian government had requested a “ceasefire,” though he noted that any consideration would depend on the reopening of the Strait of Hormuz.

Trump is expected to address the nation later in the evening with an update on the conflict, according to the White House. Markets are watching closely for any announcement that could ease concerns about inflation and global growth.

Trump’s narrative — describing Iran’s new president as “smart” and suggesting the conflict could conclude within weeks — helped restore investor appetite for risk assets.

Local data and expectations

On the economic front, solid U.S. data provided additional support to markets. Retail sales rose strongly in February, private employment continued to grow in March, and manufacturing activity also rebounded during the month.

Domestically, the Bank of Mexico released the results of its survey of private-sector analysts. The consensus forecast sees the peso ending the year at 18.10 per dollar, unchanged from the previous month, implying a depreciation of nearly 1.5%.

Limited movement in the exchange rate is expected in the coming sessions due to public holidays in Mexico. Traders will remain focused on developments in the Middle East while awaiting further news that could confirm the recent improvement in market sentiment.